Picture this: A creaky stage where the US dollar, once the globe’s headliner, croaks out its greatest hits to a dwindling crowd. Bangladesh, clutching dollar bills like relics, hesitates at the edge of the dance floor. But the music’s changing -- and the world’s economic order is remixing itself.
As of May 2025, the question isn’t if the dollar’s dominance will fade, but when. Let’s unpack why Bangladesh’s two-step toward financial sovereignty remains half-hearted -- and how it can pivot before the lights dim.
De-dollarization: A global revolution in motion
Post-1945, the dollar reigned supreme, backed by gold and American muscle. Then came 1971: Nixon axed the gold standard, turning the dollar into a faith-based currency -- a “trust me, bro” note.
Today, that trust is crumbling. BRICS+ (now 15 nations, including Saudi Arabia and Egypt) trades over 40% in local currencies, bypassing dollars entirely. Even ASEAN’s 2024 “Jakarta Accord” mandates 30% local currency trade by 2026.
Yet Bangladesh, with $28 billion in forex reserves (up from 2023’s $26bn but still half 2021’s peak), clings to the dollar like a security blanket. External debt? $112bn, 52% dollar-denominated. Trade with China? $31bn annually, yet 98% still in dollars. The math is clear: Dependency is a trap.
The Rooppur debacle: A cautionary tale
Take the Rooppur Nuclear Power Plant saga. Sanctioned by the West, Russia demanded yuan or rubles for its $12.65bn project. Bangladesh scrambled for a yuan swap with China, only to borrow $4.7bn from the IMF -- in dollars. “It’s like paying for liberation with shackles,” grumbles a Bangladesh Bank insider.
Meanwhile, BRICS+ nations hoard gold like dragons. Russia’s reserves hit 2,500 tons, China’s shadow stockpile nears 5,000 tons, and India swaps rupees for Russian oil. Bangladesh? 17.3 tons -- enough to back 0.6% of the taka. “Gold isn’t a luxury; it’s insurance,” argues a BRICS+ central banker.
The rise of the rest
The US debt, now $37.1 trillion, grows by $1 trillion every 90 days. Meanwhile, alternatives thrive: China’s CIPS processes 25% of its cross-border yuan trade, and India’s UPI clocks 12 billion transactions monthly. Even the IMF warns of “accelerated fragmentation” in its 2025 Global Financial Stability Report.
But Bangladesh hesitates. While Vietnam inks a yuan-dong swap and Malaysia trades oil in ringgit, Dhaka’s forex reserves remain 68% dollar-heavy. “Fear of IMF reproach paralyses us,” admits a finance ministry official.
Bangladesh’s path forward
1. Local currency leaps: Bangladesh recently signed a yuan-taka swap with China, aiming to convert 15% of bilateral trade by 2026. Talks with India for rupee-taka deals are underway. “SAARC could be our testing ground,” says a commerce ministry strategist.
2. Golden gambits: Following Ethiopia’s BRICS entry, Bangladesh eyes membership. A 2024 gold audit (the first since 1971) revealed untapped reserves in northern mines. Partnering with Russian firms, Bangladesh plans to triple reserves by 2027.
3. Digital taka dawn: The Central Bank’s “Digital Taka” pilot, launched in 2024, slashed remittance fees to 2%. Partnering with China’s e-CNY, it aims for regional dominance. “Why use volatile crypto when we can digitize sovereignty?” asks project lead Dr Fahmida Khatun.
4. Sanction-proofing: After US sanctions on Rooppur contractors, Bangladesh joined ASEAN’s Regional Payment Connectivity, using local currencies for 20% of regional trade. “Diversification is survival,” asserted a foreign policy professional.
From hesitation to liberation
The dollar’s encore won’t last. As BRICS+ nations draft a gold-backed trade currency and ASEAN goes local, Bangladesh’s choice is stark: Dance to the old tune or lead the new rhythm.
The taka won’t rival the dollar overnight, but neither did China’s yuan -- now 7% of global reserves.
Final words? Borrow a line from economist Jeffrey Sachs’ 2025 Davos speech: “Currency sovereignty isn’t earned -- it’s seized.” Bangladesh, it’s time to grab the mic.
Zakir Kibria is a writer and nicotine fugitive. Entrepreneur | Policy Analyst | Chronicler of Entropy | Cognitive Dissident. “Empires decay. Pragmatismsurvives. Stay sarcastic.” Email: [email protected].
